Jordanian Islamic Banks Research Articles

THE IMPACT OF FINANCIAL PERFORMANCE OF STOCK PRICES OF JORDANIAN ISLAMIC BANKS (DURING PERIOD FROM 2010 TO 2018)

This study aims to identify the impact of financial performance of stock prices of Jordanian Islamic Banks which are listed on the ASE. In order to achieve the goal of this study, the researcher collected and analyzed data from two banks, as a study sample, during the period (2010 to 2018), using the panel data method. The study the measures the financial performance in financial ratios which were represented in (return on assets, return on equity, change in earnings per share) and were measured at stock prices. The results of the study showed that there is a discussion of the results of the main variable. Based on the results of the previous statistical tests, it was found that there is a significant statistical significance between the financial performance of the Islamic banks represented by (return on assets, return on equity, change in earnings per share); therefore, we believe that this result is consistent with economic studies and financial and market analyzes, therefore, stock prices are an indicator of the health of growth in the financial markets, and evidence of stock prices for banks which constitute the basis of stability and the functioning of markets, all due to the profitability of banks and stability of financial performance. The researcher recommended that the Jordanian Islamic banks seek to increase their profits and improve their financial performance and strive for excellence in their activities in order to win the trust and preservation of customers. He also recommended Islamic banks to distribute dividends on a periodic basis to shareholders and encourage them to keep shares instead of selling, which leads to the evaporation of those banks.Keywords: Financial Performance, Islamic Banks, Stock Prices.JEL Classifications: C18, G21DOI: https://doi.org/10.32479/ijefi.9157

مدى اهتمام المصارف الإسلامية بالمسؤولية الاجتماعية:, دراسة مقارنة بين بنك البركة الجزائري والبنك الإسلامي الأردني خلال الفترة 2012-2017

This study aims to show the interest of Al Baraka Bank of Algeria and the Islamic Bank of Jordan in social responsibility, and to measure their commitment to their social role.The study concluded that there is a contribution from the Islamic banks studied in spending on social responsibility programs in varying proportions, and that these banks do not pay much attention to the disclosure of their social identity.In light of the results of the study, we recommend that Al Baraka Bank of Algeria should work to increase the spending on social responsibility programs, as well as the need to evaluate the disclosure of both banks about their social role through annual reports. Key words - Social responsibility , Islamic banks, Al Baraka Bank of Algeria, Jordan Islamic Bank, Social identity index.

Dividend-Payout Policy and Share-Price Volatility in Islamic Banks: Evidence from Jordan

This study aims to examine the relationship between dividend-payout policy (cash dividends, share dividends, and retained earnings), and volatility in the share price of Islamic banks, using regression methods such as SPSS. This study uses data from Jordan Islamic Bank and Al-Safwa Bank during 2009–2018. According to the results, there is a negative correlation between dividend-payout policy and volatility in share price. In addition, the dividend-payout policy of Islamic banks as it relates to volatility in share price has a positive correlation with retained earnings. Cash dividends had a greater effect than shares dividends on the stability of the market value of the share. This study also confirms that the effect of the dividend-payout policy is attributable to mediator variables (debt ratio, net profits, the size of the bank), and the amount of shares dividends was statistically insignificant. This research has provided about 70% of the independent variables explaining share volatility, and these variables are mostly mediator variables. Based on these findings, dividend payout policies should be examined carefully before making investment decisions about the distribution of profits.

Assessment of liquidity risk management in Islamic and conventional banks - an empirical study

The aim of this study was to assess liquidity risk management (LRM) practices in Jordanian Islamic and conventional banks during the period (2013-2017). Data used were comprised from six banks, which consisted of three Islamic and three conventional banks in Jordan. Data from the banks financial annual reports covering from 2013-2017 were used to calculate the ratios used as a substitute for liquidity risk in conventional banking as well as Islamic banking in Jordan. The study found the relationship of the size of financial institution, return on asset, return on equity, and capital adequacy ratio with liquidity risk measurement is positive and important both in Islamic banks and conventional banks. Researchers found the practices of LRM are not optimal, yet were based on some considerations explained in this study. Further, progressive actions needs to be taken by the regulators and the banking players to improve the LRM practices.

A model for measuring the direct and indirect impact of organisational culture factors and knowledge-sharing on the success of employee performance (field study in Jordanian Islamic banks sector)

The purpose of this paper was to analyse the direct and indirect impact of organisational culture factors, which are seen to consist of participation, compliance, consistency, adaptability, and strategic direction, with the objective to achieve success in employee performance through the mediation of knowledge-sharing. Additionally, the research is based on an empirical research encompassing a sample of three Islamic banks (totalling 235 employees) in Jordan where respondents answered the survey questions. The analysis of data obtained was conducted via Smart PLS software. Research studies imply the confirmation of studying the direct and indirect impacts of organisational culture factors and knowledge-sharing on the success of employee performance. Based on these results, it can be concluded that knowledge-sharing fully mediates the relationship between organisational culture factors (participation, compliance, and strategic direction) on the success of employee performance, and partially mediates the relationship between organisational culture factors (compliance and consistency) on the success of employee performance.

A model for measuring the direct and indirect impact of organisational culture factors and knowledge-sharing on the success of employee performance (field study in Jordanian Islamic banks sector)

The purpose of this paper was to analyse the direct and indirect impact of organisational culture factors, which are seen to consist of participation, compliance, consistency, adaptability, and strategic direction, with the objective to achieve success in employee performance through the mediation of knowledge-sharing. Additionally, the research is based on an empirical research encompassing a sample of three Islamic banks (totalling 235 employees) in Jordan where respondents answered the survey questions. The analysis of data obtained was conducted via Smart PLS software. Research studies imply the confirmation of studying the direct and indirect impacts of organisational culture factors and knowledge-sharing on the success of employee performance. Based on these results, it can be concluded that knowledge-sharing fully mediates the relationship between organisational culture factors (participation, compliance, and strategic direction) on the success of employee performance, and partially mediates the relationship between organisational culture factors (compliance and consistency) on the success of employee performance.

The impact of social capital in achieving competitive priorities An applied study on Jordanian Islamic banks

This study aimed to know the effect of social capital (trust, peership, cooperation, and social integration) onachieving the competitive priorities (quality, cost, flexibility, delivery, time of service delivery, andexcellence in the service) in the Jordanian Islamic banks. Study sample consisted of the Jordanian Islamicbanks (Jordanian Islamic Bank, Arab International Islamic Bank and Jordan Dubai Islamic Bank). Al-RajehiBank was excluded because the study was limited to the Jordanian Islamic banks, and Al-Rajehi is unjordanianIslamic.The results also showed the presence of positive significant relation between the social capital variables(trust, peership, cooporation, and social integration), and the presence of a positive significant effect of thesevariables together on the competitive priorities.

The impact of information systems disclosures as a part of structural capital on banks’ profitably: a case study of Islamic banks in Jordan

Aim: This study aimed to show the impact of intellectual capital disclosures related to information systems (IS) on profitability of Islamic banks in Jordan for the years (2013-2017).Background: Accounting information systems spreading widely because of the speed and accuracy of these technologies in the completion of work. Thus, the study illustrates the impact of intellectual capital disclosures related to information systems (IS) on profitability.Methodology: To achieve study goals an analytic descriptive process was used depended on published data within annual financial reports to study society with sample size reached all Islamic banks in Jordan with (one sample T-Test) and (simple linear regression).Contribution: The study will be useful to under light the importance of intellectual capital disclosures in general and intellectual capital disclosures related to information systems (IS) and it is impact on profitability.Findings: The study is revealed that the most important outcome showed there is an impact of intellectual capital disclosure related to information systems (IS) as structural intellectual capital on profitability of Islamic banks in Jordan.Recommendations to Practitioners: The study recommended continuing and increase declaration about intellectual capital related to information systems.Recommendations to Researchers: The study recommended with necessity of doing extra studies about the same topic in different field(s).Impact to Society: Society will be recognized the importance of intellectual capital disclosures related to information systems (IS) and it is impact on profitability. Â

The Effect of Dividend Policy on the Market Value of the Jordanian Commercial and Islamic Banks Listed on the Amman Stock Exchange

This study aims at examining the effect of Dividend Policy on the market value of Jordanian commercial and Islamic banks. The study population consists of all Jordanian banks listed on the Amman Stock Exchange during the period from 2008 – 2018. Data were collected from the annual reports of the sample banks. After the data collection, they were analyzed using descriptive analysis, correlation analysis, and multiple regression analysis.
 
 The results showed a statistically significant impact of dividend policy, this result indicates that there is an impact of the dividend policy on the market value of Jordanian commercial and Islamic banks listed on the ASE during the period 2008-2018. The results also showed a difference between the companies in terms of dividend policy followed, in addition, asymmetry in the Dividend Policy in banks during the study period. The study recommended a number of recommendations, including that manager of firms, should develop effective dividend payout policies to ensure that their firms pay out dividends to enhance the value of their companies and plan an efficient and reliable dividend policy, to suit the wishes of investors, and to engage stakeholders in a dialogue on dividend policy.

INFORMATION QUALITY AND THE ORGANIZATIONAL EFFECTIVENESS: THE MODERATING EFFECTS OF ORGANIZATIONAL CULTURE AMONG CONVENTIONAL AND ISLAMIC BANKS

Quality of information is a priceless asset for organization to possess as its assist in carrying out business plans and changes. These business changes usually support the management executive in decision makings. In view of that, this study examines the information quality in AIS and its effects on organizational performance among conventional and Islamic banks in Jordan. To achieve that, proportionate stratified random sampling is applied to the information system users of sixteen conventional and Islamic banks in Jordan. Total copies of 600 questionnaires were distributed and only 250 among the returned copies were valid, suggesting a valid response rate of 41.7%. The study adopts the partial least square (Smart PLS 3) method to enhance the data analysis and perform hypotheses testing. Findings clearly show that quality of information is the key for business growth as it indicates a positive effect on organizational performance. Further result shows that organizational culture improves and increases business performance when combined with information quality. For this reason, conventional and Islamic banks in Jordan should have well-developed AIS as it assists organizations to -attain higher performance. There is need for more development in management skills to fully exploit the AIS in order to realize a greater organizational performance. In other words, full implementation of AIS should be given more priority by the managements of these conventional and Islamic banks.

The Impact of External Shari'ah Auditing on the Efficiency of Jordanian Islamic Banks Performance

This study aimed to explore the impact of external Shari'ah auditing on the efficiency of Jordanian Islamic banks performance. This study has used SEM to analyze collected data from auditors and employees in Islamic banks in Jordan. This study has used a questionnaire to explore the perception of external Shari'ah audit of Islamic banks in Jordan, then the model estimated, after dropping the variables show good model fit indicators. this study examined the effect of Shari'ah audit through eight construct and found that, seven constructs significantly affect Islamic banks performance, i.e. planning, risk assessment, materiality assessment, sampling, internal controls-testing, evaluation of observations and Shari'ah non-compliances, using the work of relevant internal functions leads to better efficiency of performances in Islamic banks, except internal control-assessment. This study has practical and significance contribution for Islamic banks about of importance external Shari'ah auditing on its efficiency.

Total Rewards and Employee Retention in a Middle Eastern Context

This article examines the influence of total rewards—comprising extrinsic, intrinsic, and social rewards—on employee retention in Islamic banks in Jordan, with particular focus on the employee perspective. A questionnaire is used to collect data from the study sample, which consists of 500 employees working in various Islamic banks across Jordan. The study hypotheses are then tested using partial least squares (PLS) technique by applying structural equation models (SEMs). Results show that extrinsic, intrinsic, and social rewards are all important factors in achieving employee retention. Interestingly, social rewards were shown to have the highest level of influence on employee retention. This research is new in the Jordanian context; it offers a deeper understanding of some of the most important factors in retaining talent and thereby increasing organizational productivity and competitive advantage. It furthermore provides new insights into the relationship between total rewards and employee retention within the context of the Middle East, a combination previously uncharted.

PERAN SOSIAL BANK SYARIAH BERDASARKAN INDEKS MAQASHID SYARIAH (STUDI KASUS DI JORDAN)

This study aims to determine the implementation of Islamic bank social values as they should have been implemented . This study uses the Maqashid Syariah Index with three main social indicators, namely education, justice, and social welfare. The object of this research are three Islamic banks in Jordan (Jordan Islamic Bank, Safwa, and International Islamic Arab Bank). The results showed that all the banks have a low Maqashid Syariah Index for all indicators, which meant that the practice of implementing the social values of Islamic banks in Jordan are not close to what people have expected especially for indicators of justice and social welfare. In the future, Islamic banks need to increase social contributions, especially on indicators of justice and social welfare.

Building Customers Satisfaction Using Social Responsibility Communications of Islamic Banks in Jordan

Building Customers Satisfaction Using Social Responsibility Communications of Islamic Banks in Jordan

Are SMEs Efficient? Applied Study on the SMEs Financed by Islamic Banks in Jordan

This study aimed at measuring the role of Islamic banks (IB) in Developing small and medium enterprises (SMEs) in Jordan, by measuring the efficiency level of such enterprises. The study population consisted of all small and medium enterprises SMEs funded by Islamic Banks IB operating in Jordan for 2016, which estimated at (3207) enterprises. The full survey method was used. The study found that there was a weak role of Islamic banks in developing small and medium enterprises in Jordan. This study showed that SMEs financed by Islamic banks showed that SMEs funded by Islamic banks (IB) have achieved the lowest economic efficiency compared to those financed by other microcredit sources operating in the economy. Finally, The study recommended and suggested some implications that enhance the role of Islamic microfinance in developing the SMEs sector in Economy of Jordan . Keywords: SMEs , Efficiency, Islamic Banks, Jordan. DOI : 10.7176/EJBM/11-4-02

The Role of the Corporate Governance Committees and the Financial Risk in Islamic Banks: A Field Study in Jordan

This study has identified the role of the board of directors according to the corporate governance committees and the financial risk, in Islamic bank as a case study in Jordan.In order to achieve the purposes of this study, two kinds of data are adopted. First, data is collected through questionnaires, field visits, for managements of Islamic banks operating in Jordan. Secondary data is collected through books, journals and internent, which has related to the research.The finding of the study that the creation of corporate governance committees resulting from the board of directors in Islamic banks as a result of financial risk. The study concluded a set of recommendations. Finally, financial experiment may not depend exclusively to some members. It is as a first study in Jordanian Islamic banks that explain into account the issue of the board of directors committees role to the corporate governance with the financial risk in Jordan. As well as the lack of studies that examine the theme of corporate governance and financial risk.

Building Customers Satisfaction Using Social Responsibility Communications of Islamic Banks in Jordan

This study aims at diagnosing the impact of social responsibility on satisfaction of Islamic banks' customers in Jordan, then exploring the media means used by such banks to promote the SR programs within local community. Determining the statistical differences in SR, media means and customers satisfaction according to many demographical and organizational factors. This research is descriptive. The questionnaire is the tool of collecting the data needed from research population. The sample size reached to 384 customers, and cluster random sample is used. The study conclude that there is a positive statistical impact of support social responsibility programs on customers satisfaction , but the support social responsibility and customers satisfaction are statistically weak, and the media means used to promote SR programs are traditional and doesn’t fit the societal needs. Finally, the study recommends some implications and recommendations that support social responsibility communications and customers’ satisfaction in surveyed companies. Keywords: Customers Satisfaction, Social Responsibility, Marketing Communications, Islamic Banks, Jordan. DOI : 10.7176/NMMC/78-03

Assessment of Liquidity Risk Management in Islamic and Conventional Banks - An Empirical Study

The aim of this study was to assess liquidity risk management (LRM) practices in Jordanian Islamic and conventional banks during the period (2013-2017). Data used were comprised from six banks, which consisted of three Islamic and three conventional banks in Jordan. Data from the banks financial annual reports covering from 2013-2017 were used to calculate the ratios used as a substitute for liquidity risk in conventional banking as well as Islamic banking in Jordan. The study found the relationship of the size of financial institution, return on asset, return on equity, and capital adequacy ratio with liquidity risk measurement is positive and important both in Islamic banks and conventional banks. Researchers found the practices of LRM are not optimal, yet were based on some considerations explained in this study. Further, progressive actions needs to be taken by the regulators and the banking players to improve the LRM practices.

Talent Management Strategy and its impact on Staff Development as a Foundation in Total Quality Management (TQM): Case Study of the Jordan Islamic Bank

Talent Management Strategy and its impact on Staff Development as a Foundation in Total Quality Management (TQM): Case Study of the Jordan Islamic Bank

(Jordanian Islamic banks Implemet the Cost-Based on Activites System (ABC: مدى تطبيق البنوك الإسلامية الأردنية لنظام التكاليف المبني على الأنشطة (ABC)

The study aimed to investigate Jordanian Islamic banks implementatiom of cost-based system activities. To achieve this goal, a questionnaire was designed according to the objectives and hypotheses of the study. The study population consisted of all employees of Islamic banks operating in the Hashemite Kingdom of Jordan. The study results indicated that the sample members agreed on terms that measure the application of the Jordanian Islamic banks to the system of costs based on the activities and the paragraph that states: The administrative structure helps in the implementation of the cost system based on anach E، ranked first، while the second ranked paragraph، which states: lead-based activities to reduce system costs indirect cost ratio The result (1) validates the hypothesis that: The application of Islamic banks to the system of costs based on activities. The study recommended that the cost-based system should be applied to Islamic banks. The studies examined showed that the cost-based system reduces production costs due to the objectivity of indirect cost measurement measures and increases the ability of Islamic banks to benefit from their resources